WT/DS344/R 
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ANNEX D 
 
 
ORAL STATEMENTS OR EXEC UTIVE SUMMARIES THEREOF  
FIRST AND SECOND MEETINGS 
 
 
Contents Page 
Annex D-1 Executive Summary of the Op ening Statement of Mexico – First 
Meeting D-2 
Annex D-2 Closing Statement of Mexico – First Meeting D-6 
Annex D-3 Executive Summary of the Opening Statement of the 
United States – First Meeting D-8 
Annex D-4 Closing Statement of the United States – First Meeting D-12 
Annex D-5 Third Party Oral Statement of China D-14 
Annex D-6 Third Party Oral Statement of the European Communities D-15 
Annex D-7 Third Party Oral Statement of Japan D-18 
Annex D-8 Third Party Oral Statement of Thailand D-21 
Annex D-9 Executive Summary of the Opening Statement of Mexico – Second 
Meeting D-22 
Annex D-10 Executive Summary of the Opening Statement of the 
United States – Second Meeting D-25 
 
 WT/DS344/R 
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ANNEX D-1 
 
 
EXECUTIVE SUMMARY OF TH E OPENING STATEMENT OF 
MEXICO – FIRST MEETING 
 
 
Mr Chairman, members of the Panel: 
 
I. SECURITY AND PREDICTABILITY IN THE WTO CASE LAW 
1. Article 3.2 of the DSU states that the disput e settlement system is a "central element" in 
providing security and predictability to the multilatera l trading system, which creates an expectation 
that panels will adopt the reasoni ng in previous Appellate Body re ports on the same issues.  The 
question of whether the Anti-Dumping Agreement  allows investigating authorities to disregard or 
"zero" intermediate price comparisons where the export price exceeds normal value, was ruled on for 
the first time in 2001 by the Appellate Body in EC – Bed Linen .  The zeroing procedures in that first 
case were applied in the context of an original inv estigation and in reference to comparisons between 
the weighted average of export prices and normal valu e, as defined in Article 2.4.2.  However, the 
principles of definition set in the text of the Ag reements, as the Appellate Body observed, clearly 
exceed the ambit of original investigati ons and average-to-average comparison. 
2. This became evident in the next "zeroi ng" case analysed by the Appellate Body:  
US - Softwood Lumber V .  Here, the Appellate Body extended its findings regardi ng zeroing practices, 
which apply in an original investigation where transaction-to-transaction comparison is used.  In 
reaching its conclusion, the Appellate Body interp reted the text on the definitions of "dumping", 
"margins of dumping" and "product" , in Article VI of the GATT 1994 and Article 2.1 and 2.4.2 of the 
Anti-Dumping Agreement , in the same way as it had in EC – Bed Linen . 
3. The Appellate Body again relied on the same  provisions of the Agreements and the same 
interpretation in US – Zeroing (EC 1) , in which it determined that the United States' zeroing 
procedure in original investigations where the av erage-to-average comparison methodology is used, is 
incompatible "as such" with the United States' obligations under the Agreements, and that the zeroing 
procedures as applied in sixteen periodic revi ews where the comparison was between individual 
export prices and monthly average normal value, w as likewise incompatible with the United States' 
obligations for calculating margins of dumping for th e exporter in question, and in respect of the 
investigated product as a whole. 
4. More recently, in US – Zeroing (Japan) , the Appellate Body resolved the last outstanding 
issue when it recognized that zeroing procedures in administrative reviews, sunset reviews and other 
proceedings are inconsistent "as such" with Artic le VI of the GATT 1994 and the relevant provisions 
of the Anti-Dumping Agreement .  Again, an essential part of the Appellate Body's reasoning was 
consistency in applying the defin itions of "dumping", "margins of dumping" and "product" discussed 
in EC – Bed Linen . 
5. In examining the Appellate Body 's consistent treatment of this matter in its reports, this Panel 
should acknowledge two releva nt points.  First, despite the United States' efforts to confuse the issue, 
the measure challenged in each of the above-menti oned cases is the same.  As the Appellate Body 
said in US – Zeroing (Japan) , there is a single zeroing measure that applies in different contexts.  
Secondly, in its decisions in all these cases, the A ppellate Body has changed neither its reasoning nor 
its interpretation of the text of the Agreements.  Although the facts themselves have been different in 
each case, the Appellate Body's construction of the Ag reements has been consistent in all the cases.   WT/DS344/R 
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In its reports, the Appellate Body has always relied on the same fundamental principles of the 
Agreements. 
6. In view of the foregoing, Mexico submits th at the texts of the Agreements can support only 
the conclusion that all sales comparisons should be considered in calculating dumping margins. 
II. THE CONCEPTS OF "DUMPING", "MARGINS OF DUMPING", AND 
"PRODUCT" 
7. The position taken by Mexico and the Appellate  Body rests on a number of basic principles of 
law.  First, "dumping" and "margins of dumping" , as defined in Article VI:1 and VI:2 of the 
GATT 1994 and Article 2.1 of the Anti-Dumping Agreement , relate to the "product" in question.  
Secondly, the concepts of "dumping" and "margins of dumping" relate only to  the behaviour involved 
in establishing exporter or producer prices for the exported product. 
8. The Appellate Body established in several cases a definition of the terms "dumping" and 
"margins of dumping" that is clear,  coherent and in keeping with the texts.  The United States, on the 
other hand, supports interpretations of these terms that  are incompatible with the text, context, intent 
and object of the Agreement and so are incompatible  with the customary rules of interpretation of 
public international law. 
"Margins of Dumping" – calculated for the product as a whole and not for individual transactions 
or models 
 
9. Article VI:1 and VI:2 of the GATT 1994 defin es "dumping" in relation to a "product".  This 
definition is carried over to the Anti-Dumping Agreement  by Article 2.1, and by virtue of the opening 
phrase of the latter, "[f]or the purpose of this Agreement", the definition applies throughout the 
Agreement.  Article 2.1 is thus a rule that gove rns the interpretation and the context of the term 
"margin(s) of dumping" throughout the Agreement.  Similarly, the term "dumping" has the same 
meaning for all provisions of the Agreement an d for all types of anti-dumping proceedings.  
Consequently, any "dumping" or "margin of dumping"  in conformity with the Agreement must be 
calculated in relation to the produc t under investigation or review. 
10. This raises the question of what the Agreements  refer to when they use the term "product".  
The Appellate Body gave the answer in EC – Bed Linen .  It found that the "product" for which the 
dumping and margins of dumping are calculated is a nd must be the investigated product "as a whole". 
11. The terms "dumping" and "margins of dumping"  necessarily relate to the same definition of 
"product" "because it is the product that is introduced  into the commerce of another country at less 
than its normal value in that country" (Report of the Appellate Body, US – Zeroing (Japan) , 
para. 109).  This concept of dumping for a defined pr oduct under investigation or review is also a 
factor taken into account in determining whether dumping causes or threatens injury. 
12. Mexico concedes that it is permissible – even  necessary in some circumstances – to carry out 
intermediate price comparisons on a model or transaction basis.  However, as the Appellate Body has 
found time and again, starting with EC – Bed Linen  and up to US – Zeroing (Japan) , such 
intermediate comparisons cannot be treated as "mar gins of dumping" as defined in the Agreements. 
13. The United States' interpretation wrongly assumes that it is individual importers that engage 
in dumping.  This position is at odds with th e text and the intent of the Agreements. WT/DS344/R 
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"Margins of dumping" – calculated in respect only of individual exporters or foreign producers 
 
14. The Anti-Dumping Agreement  does not address the behaviour of individual importers or 
individual import transactions.  Rather, it provides c onsistently that determinations of dumping are 
carried out in respect of every exporte r or foreign producer investigated. 
15. The focus on the exporter is evident throughout the text of Article VI of the GATT 1994 and 
the Anti-Dumping Agreement , and the Appellate Body found that this fact is clearly confirmed by the 
text of Article 6.10 of the Anti-Dumping Agreement . 
16. Anti-dumping measures are designed to offset  the effects of the pricing behaviour of 
producers and exporters, since the producer or expo rter is necessarily involved in determining the 
price of the exports giving rise to sales at a price lower than normal value.  Accordingly, the prices of 
all the export transactions of an exporter or foreign produce must be taken into account in determining 
whether it has engaged in dumping and, if so, to what extent. 
17. There is a clear distinction between the estab lishment or collection of duties and the margin of 
dumping, which sets a ceiling on the amount of the duties that may be established or collected. 
III. INTERPRETATION OF THE PHRASE "ALL COMPARABLE EXPORT 
TRANSACTIONS" IN ARTICLE 2.4.2 
18. The United States overlooks this fundamental poi nt when it reiterates in its First Submission 
that it is the phrase "all comparable export transactions" in Article 2.4.2 of the Anti-Dumping 
Agreement that lays down the requirement to calculate  margins of dumping in reference to the 
"product" as a whole.  It submits that, while th e phrase "all comparable export transactions" refers 
solely to average-to-average comparisons, zeroi ng is prohibited only in the context of such 
comparisons. 
19. In Mexico's view, this position is not supporte d by the reports of the Appellate Body.  In the 
first case, EC – Bed Linen , in which zeroing was addressed and where the parties referred expressly in 
their arguments to Article 2.4.2, it is plain that th e principles that led the Appellate Body to determine 
that investigating authorities may not ignore or alte r the results of intermediate price comparisons, 
were to be found in the definitions of "dumping" an d "margins of dumping" in Article VI:1 and VI:2 
of the GATT 1994 and Article 2.1 of the Anti-Dumping Agreement .  The fact that the phrase, "all 
comparable export transactions" was discussed in the context of Article 2.4.2 and the related 
arguments, was not a decisive element in the report of the Appellate Body. 
20. Nor does Mexico agree with the United States ' argument in its First Written Submission that 
in its report in US – Softwood Lumber V , the Appellate Body relied on the phrase "all comparable 
transactions" in Article 2.4.2.  As in its earlier report, in EC – Bed Linen , the Appellate Body based its 
findings in US – Softwood Lumber V  essentially on the definitions of "dumping" and "margins of 
dumping" that apply throughout the Anti-Dumping Agreement .  The Appellate Body rejected the 
United States' argument, concluding that "dumpi ng" and "margins of dumping" apply only to the 
investigated product as a whole and may not be determ ined at the level of a sub-product, model or 
category of that product. 
21. The United States further argues that the report of the Appellate Body would void the phrase 
"all comparable export transactions" of meaning if  zeroing were prohibited in all the comparison 
methods provided for in Article 2. 4.2.  However, as the Appellate  Body said, the reason why the 
phrase "all comparable export transactions" appears onl y in connection with the average-to-average 
comparison methodology is that this is the only me thodology to which it is relevant.  Since in the 
average-to-average methodology groups of transacti ons can be aggregated, the phrase "all comparable 
export transactions" requires that each group include a ll transactions that are comparable, and that no  WT/DS344/R 
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export transaction be excluded when margins of dumping are determined on the basis of this methodology.  Furthermore, the average-to-ave rage comparison methodology involves calculating a 
weighted average export price, whereas the trans action-to-transaction methodology takes account of 
all export transactions individually and compares them  with the most appropriate transactions on the 
domestic market.  Consequently, as the Appellate Body observed, the phrase "all comparable export 
transactions" is simply not relevant to the transaction-to-transaction methodology. 
IV. MEXICO'S REQUEST FOR FINDINGS 
22. The United States has expressed concern that Me xico refers to zeroing procedures as if they 
were a single measure.  It is beyond all doubt  that, as the Appellate Body concluded in US – Zeroing 
(Japan) , there is one single zeroing measure. 
V. CONCLUSION 
23. Mexico would again remind the Panel that the measure challenged as such in this dispute is 
the same as the measure on which the Appellate Body issued a decision in cases brought by Canada, 
the European Communities and Japan.  The Appellate Body has consistently he ld that the measure is 
in breach of the United States' obligations under the Agreements. 
24. In the interests of the secur ity and predictability of the WTO system and in order to ensure 
that the Agreements negotiated by Members are impl emented as their texts require, we urge the Panel 
to allow all Mexico's claims. 
 WT/DS344/R 
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 ANNEX D-2 
 
 
CLOSING STATEMENT OF ME XICO – FIRST MEETING 
 
 
I. INTRODUCTION 
 
Mr. Chairman, Members of the Panel:    
1. On behalf of the Mexican de legation, it is once again our priv ilege to appear before you to 
present the views of Mexico concerning the issues in this dispute.    2. Our closing statement will be brief and will focus on some key points.   
 
3. In its opening statement, the United States equated Mexico's position regarding the security 
and predictability of WTO dispute settlement to "t he Panel need do nothing more than blindly follow 
prior Appellate Body reports".  This is incorrect.  This dispute is not about the primacy of Appellate 
Body reports over panel proceedings nor is it about the doctrine of precedent.  Rather, it is about the 
correct legal interpretation of the relevant pr ovisions of the GATT 1994 and the Anti-dumping 
Agreement.  Mexico asks only that this pane l correctly interpret these provisions giving due 
consideration to prior Appellate Body findings on identical issues.   
 4. It is notable that in the oral statements of  the parties given yesterday, no new issues were 
raised.  The first written submissions of the parties express fully the issues before the Panel.    
5. The differences in the positions of Mexico a nd the United States can be distilled into two 
questions.    6. First, which WTO terms and provisions fo rm the foundation for the prohibition against 
zeroing?  The United States takes the position that the sole basis for the prohibition is the phrase "all 
comparable export transactions" in Article 2.4.2 of  the Anti-dumping Agreement.  Mexico takes the 
position that the foundation of the prohibition is found in the meaning of the terms "dumping", 
"margins of dumping" and "product" in Articles VI:1 and 2 of GATT 1994 and Article 2.1 of the 
Anti-dumping Agreement.    7. Second, when interpreting the WTO terms and provisions applicable to the assessment of 
anti-dumping duties, should the focus be on the importer or the exporter/producer?  The United States 
takes the position that the focus should be on the im porter.  Mexico takes the position that the focus 
should be on the exporter/producer.    8. Contrary to the submissions of the United St ates, the responses to these questions do not give 
rise to more than one "permissible" interpretation for each response.   
 
9. The response to each question poses a single permis sible interpretation.  In both instances, the 
interpretations posed by Mexico are the permissi ble ones.  Mexico's interpretations attribute a 
consistent meaning to the applicable terms and provisions as they are used throughout the Anti-
dumping Agreement.  They take into account the entire context of the Anti-dumping Agreement.  
They follow the interpretations presented by the Appellate Body in its reports concerning zeroing 
practices.     WT/DS344/R 
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 10. In contrast, the interpretations posed by the United States do not  attribute consistent meaning 
to the applicable terms and provisions as they ar e used throughout the Anti-dumping Agreement.  
They do not  take into account the entire context of the Anti-dumping Agreement.  Finally, they 
directly contradict  the interpretations presented by the A ppellate Body in its reports concerning 
zeroing practices.  The interpretations posed  by the United States are, simply put, not  permissible.   
 
11. Embedded in the United States' submissions are arguments that rely on factual scenarios 
related to the technical application of anti-dumping duties.  The findings required in this dispute do 
not require the Panel to consider the many di fferent factual scenarios regarding the technical 
application of anti-dumping duties.  Rather, they require the Panel to focus on the text of the 
applicable terms and provisions of GATT 1994 an d the Anti-dumping Agreement and interpret those 
terms and provisions in a manner th at is consistent with the rules of interpretation set out in 
Articles 31 and 32 of the Vienna Convention of the Law of Treaties  as incorporated in Article 3.2 of 
the DSU.    
12. Thank you once again for agreeing to serve on th is Panel and for your efforts, and those of the 
Secretariat and translators, in preparing for this meeting.    13. This concludes our closing statement.  We would be pleased to respond to any questions you 
may have.    
 WT/DS344/R 
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 ANNEX D-3 
 
 
EXECUTIVE SUMMARY OF THE OPENING STATEMENT OF THE 
UNITED STATES – FIRST MEETING 
 
 
Mr. Chairman, Members of the Panel:   
 
Procedural Issues  
 
1. This Panel is tasked with making its own objective assessment of the matter before it.  This 
includes an assessment of the facts as well as the conformity of the challenged measures with the 
relevant covered agreements.   Mexico and some third parties, how ever, would have this Panel neglect 
its responsibilities in the name of "security and predic tability".  According to them, it is sufficient that 
the Appellate Body previously has found zeroing to  be inconsistent with provisions of the WTO 
Agreements.    
2. The Appellate Body itself has stated that its reports are not binding on panels.  Prior panel and 
Appellate Body reports should be ta ken into account only to the extent that the reasoning contained in 
them is persuasive.  In our first written submission,  we have provided cogent  reasons why the findings 
and reasoning of the Appellate Body in US – Zeroing (Japan) and US – Zeroing (EC) are seriously 
flawed with respect to certain aspects relevant to th is dispute and therefore should not be followed.   
 
3. "Security and predictability" is not an indepe ndent obligation, nor is it a stated "object and 
purpose" of any WTO Agreement.  The only referen ce to this phrase in the WTO Agreement is in 
DSU Article 3.2, which makes clear that security  and predictability are achieved only when the 
dispute settlement system works as provided therei n – that is, through the proper application of 
customary rules of interpretation of public international law to the agreed-upon provisions of the 
covered agreements, in order to preserve the right s and obligations to which the Members agreed.  
Security and predictability is provided by a dispute settlement system that does not add to or diminish 
the rights and obligations of WTO Members.  A pa nel is not permitted to follow a prior panel or 
Appellate Body report in the name of "security and predictability" where that prior report has added to 
or diminished rights and obligations.   
 
Scope of this Dispute 
 
4. In light of its terms of reference and Articl e 7 of the DSU, this Panel may only address those 
matters identified by Mexico in its request for establishment of a panel.  In its request for 
consultations and its request for the establishment of  a panel, Mexico identified two alleged measures 
it was challenging "as such" - the use of "zeroing" in average-to-average comparisons in original 
investigations and the use of "zeroing" in assessment  proceedings.  Yet, in its first written submission, 
Mexico asserts that it is challenging a "single zeroing measure" in all antidumping proceeding 
contexts.    
5. Mexico argues that in US – Zeroing (Japan) , the Appellate Body concluded that there was 
one single rule which it found to be inconsistent with  US obligations.  A prerequisite for the Appellate 
Body to reach that conclusion was its finding that " zeroing" in all contexts and with respect to all 
types of comparisons was within the scope of Japan 's request for establishment of a panel and request 
for consultations.  That is clearly not the case here.     WT/DS344/R 
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 6. There is nothing in US law that requires a monolith ic use of "zeroing" in all contexts.  This is 
supported by the fact that Commerce is no longer ma king average-to-average comparisons in original 
investigations without providing offsets fo r non-dumped comparisons, a fact which Mexico 
acknowledges in its first written submission.  Mexi co relies on descriptions of what Commerce has 
done in the past to argue the existence of a "single zeroing measure".  Aside from the fact that these 
past examples do not cover all the contexts suppo sedly covered by the so-called "single zeroing 
measure", Mexico's arguments imply that if an administering authority acts in a non-arbitrary and consistent manner, this should expose it to dis pute settlement for somehow maintaining a separate 
measure.  This is a very troubling proposition.   
 
The Claimed Obligation to Provide Offsets  
 
7. Mexico argues that the Antidumping Agre ement imposes on Members an obligation to 
provide an offset to dumping in all types of antidumping proceedings, including assessment proceedings.  Mexico does this d espite the absence of a textual b asis for such an obligation and a 
permissible interpretation of the Antidumping Agre ement that does not require such offsets.   
 8. In the disputes to date that have addressed th e issue of offsets, the only textual basis panels 
have identified for an obligation to provide offset s has been the "all comparable export transactions" 
language in the text of Article 2.4.2 of the Antid umping Agreement.  This is consistent with the 
approach articulated by the Appellate Body in US – Softwood Lumber Dumping .  The phrase "all 
comparable export transactions" in Article 2.4.2 ap plies only to antidumping investigations and only 
when authorities use average-to-average comparisons  pursuant to Article 2.4.2.  The panels have 
consistently found that the obligation to provide offsets applies only as a consequence of the text-
based obligation to include all comparable expor t transactions when making weighted-average to 
weighted-average comparisons in an investigation.  The panels have also cons istently found that there 
is no textual basis for an obligation to provide o ffsets outside the context of average-to-average 
comparisons in investigations.  The analysis offered by the prior panels is persuasive and correct.   
 9. Article 2.4.2 provides for two symmetrical comparison types, average-to-average and transaction-to-transaction, and a third asymmetrical  comparison type, average-to-transaction, which 
may be used under certain conditions.  With respect  to the average-to-average comparisons, the 
phrase "all comparable export transactions", as interpreted by the Appellate Body in US – Softwood 
Lumber Dumping , addresses whether the relevant comparison may be made at the level of averaging 
groups (or "models").  Under this reading, the wo rd "all" in "all comparable export transactions" 
refers to all transactions across all models of the product under investigation.  This is the textual basis 
for the conclusion that margins of dumping based on average-to-average comparisons must relate to 
the "product as a whole" rather than individual averaging group comparisons.  This phrase, "all 
comparable export transactions", however, applies onl y to the use of average-to-average comparisons 
in an investigation.    10. A general prohibition of zeroi ng would negate and contradict the interpretation of the phrase 
"all comparable export transactions" that was the b asis of the obligation to provide offsets in the 
context of average-to-average comparisons.  However, in US – Zeroing (Japan) , the Appellate Body 
did just that by reinterpreting "all comparable expor t transactions" to relate solely to all transactions 
within a model, and not across models for the produc t under investigation.  In doing so, the Appellate 
Body abandoned the only textual b asis in the Antidumping Agreement for prohibiting zeroing.  In this 
case, Mexico argues that margins of dumping calcula ted in assessment proceedings must relate to the 
"product as a whole", and cannot be calculated for individual transactions.  However, "product as a 
whole" is not a term found in the Antidumping Agre ement nor does it have any defined meaning.  To 
the extent the concept of "product as a whole" has any relevance to the Antidumping Agreement, it is 
only as a shorthand for the operation of the phrase "a ll comparable export transactions" in the context WT/DS344/R 
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 of average-to-average comparisons in investiga tions.  Mexico's argument relies entirely on the 
concept of "product as a whole" being applied in a manner detached from that textual basis.   
 11. Mexico seeks to redefine the concept of dumpi ng contained in Article 2.1 of the Antidumping 
Agreement and Article VI of the GATT 1994 such that the terms "dumping" and "margins of 
dumping" relate "solely, and exclusively, to the "p roduct" under consideration taken "as a whole"".   
 12. The text of these provisions defines and describes dumping as occurring in the course of 
individual commercial transactions.  The commercial reality is that prices are generally set in 
individual transactions and products are "introduced into the commerce" of the importing country in 
individual transactions.  In other words, dumping – as defined under these provisions – may occur in a 
single transaction.  To the extent that some transac tions introduce merchandise into the market of an 
importing country at a price above normal value, this is to the benefit of the seller, not the domestic 
industry injured by other transactions made at less than normal value.    
13. Mexico asserts that dumping and margins of dumping "are concepts that have no meaning 
unless considered with reference to the product under consideration taken as a whole".  The Appellate 
Body reports relied upon by Mexico are unpersuasive because they cannot alter the simple fact that 
the relevant text of these provisions, the relevant context for interpreting the meaning of these terms, 
and the well-established prior understanding of these concepts all confirm that dumping and margins 
of dumping do have a meaning in relation to i ndividual transactions.  Our written submission sets 
forth the textual, contextual, and other evidence th at the concepts of dumping and margins of dumping 
are applicable to individual transactions.  That evidence conclusively establishes that the terms 
dumping and margins of dumping as used in Ar ticle 2.1 of the Antidumping Agreement and 
Article VI of the GATT 1994 do not support the existence of an obligation to provide offsets for instances of non-dumping in assessment proceedings.   
 
14. Mexico's misinterpretation of the term "mar gin of dumping" is the basis for its claim of 
inconsistency with Article 9.3.  Article 9.3 requires that the amount of the antidumping duty assessed 
shall not exceed the margin of dumping.  That obligation, just like the term "margin of dumping" itself, may be applied at the level of individua l transactions.  This understanding is particularly 
appropriate in the context of antidumping duty assessments, where duties are assessed on individual 
customs entries resulting from individual transacti ons for which importers are liable for payment.  
Mexico's argument that excess antidumping duties were assessed in this dispute depends on its misinterpretation of the term "margin of dumping" re ferred to in Article 9.3 as relating exclusively to 
the product "as a whole" considered on an exporter-wi de basis.  The panels examining this issue have 
consistently observed that interpreting the term "margin of dumping" as relating exclusively to the 
"product as a whole" for all importers of product fro m a particular exporter is  inconsistent with the 
importer- and import-specific obligation to pay an antidumping duty.    15. Mexico's interpretation of Article 9.3 cannot be  reconciled with the recognition in Article 9 of 
prospective normal value systems of assessment.  Under such systems, the amount of liability for 
payment of antidumping duties is determined at the time of importation on the basis of a comparison 
between the price of the individual export transacti on and the prospective normal value.  If the margin 
of dumping must relate exclusively to the "produ ct as a whole" determined on an exporter-specific 
basis, the administration of such an assessment system  is simply impossible.  An obligation to account 
for other imports in assessing antidumping duties on a par ticular entry is contrary  to the very concept 
of a prospective normal value system and, if accep ted, would effectively render prospective normal 
value systems WTO-inconsistent unless they were c onverted to a retrospective system by adopting 
retrospective assessment reviews.    16. Antidumping duties are applied at the level of individual entries.  In this way, an importer 
may be induced to raise resale prices to cover th e amount of the antidumping duty, thereby preventing  WT/DS344/R 
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 the dumping from having further injurious effect.  If, instead, the amount of the antidumping duty 
must be reduced to account for the amount by whic h some other transaction was sold at above normal 
value, possibly involving an entirely different importer, then the antidumping duty will be insufficient to have the intended effect.  The importer of  the dumped product would remain in a position to 
profitably resell the product at a price that continues to be injuriously dumped.  If Mexico's reading of 
"margin of dumping" is accepted as the sole permi ssible interpretation of Article 9.3, the remedy 
provided under the Antidumping Agreement a nd the GATT 1994 will be prevented from fully 
addressing injurious dumping.    17. Mexico claims inconsistency with the "fair comparison" requirement of Article 2.4, arguing 
that the United States has assessed antidumping duties "in excess of the actual margin of dumping for 
the product" because the duties assessed  exceeded the margin of dumping for the product as a whole.  
The relevant text of Article 2.4, however, provi des only that a "fair comparison shall be made 
between the export price and the normal value".  Th e text of Article 2.4 does not address whether any 
particular assessment of antidumping duties exceeds the margin of dumping, whether "dumping" and 
"margins of dumping" are concepts that apply to  individual transactions, or whether a margin of 
dumping may be specific to each importer.  Indeed , the text of Article 2.4 does not resolve the 
question of whether zeroing is "fair" or "unfair".  Resolution of Mexico's claim depends not on the 
text of Article 2.4, but on whether it is permissibl e to interpret the term "margin of dumping" as used 
in Article 9.3 as applying to transactions.  As prio r panels have found, it is permissible to understand 
the term "margin of dumping" as used in Artic le 9.3 as applying to an individual transaction.  
Therefore, the challenged assessments do not exceed th e margin of dumping and there is no basis for 
a finding of inconsistency with Article 2.4.    18. Any interpretation that gives rise to a gene ral prohibition of zeroing also renders the second 
sentence of Article 2.4.2, the "targeted dumping pr ovision", inutile.  This is because the targeted 
dumping methodology mathematically must yield the same result as an average-to-average 
comparison if, in both cases, non-dumped comparison s are required to offset dumped comparisons.  
This defect cannot be ignored or assumed away by supposing that the targeted dumping provision 
permits an authority to ignore any obligation in the Antidumping Agreement other than the obligation 
to use one of the two symmetrical comparison methods.    
19. The United States respectfully disagrees with the Appellate Body's reasoning in US – Zeroing 
(Japan)  that the Antidumping Agreement includes a general prohibition of zeroing.  The United States 
agrees with the reasoning applied by the panels th at outside the context of average-to-average 
comparisons in investigations the Antidumping Ag reement does not impose an obligation to provide 
offsets for non-dumping.  At a minimum, we urge th is Panel to find that a permissible interpretation 
of the Antidumping Agreement, consistent with th e Appellate Body's original interpretation in US –
 Softwood Lumber Dumping  and faithful to the text of the Antidumping Agreement, contains no 
obligation to provide for an offset to  dumping in assessment proceedings.   
   WT/DS344/R 
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 ANNEX D-4 
 
 
CLOSING STATEMENT OF THE  
UNITED STATES – FIRST MEETING 
 
 
Mr. Chairman, Members of the Panel:   
 1. On behalf of the United States' delegation, I would once again like to thank you and the members of the Secretariat for your work on this dispute.  We appreciated the opportunity to provide you with preliminary thoughts on your questions and look forward to provid ing you with additional 
comments in our written responses and our second submission.   
 
2. We will be very brief in our closing statemen t.  Mexico would have this Panel merely follow 
the Appellate Body report in US – Zeroing (Japan)  without engaging in its own analysis.  Having 
failed to include a "single zeroing measure" in its re quest for establishment of the panel, Mexico even 
argues that the Panel should find the existence of such a measure because the Appellate Body did so 
in a separate dispute.   
 3. Mexico would have the Panel do this in the interest of "secu rity and predictability".  Security 
and predictability is provided by a dispute settlement  system that does not add to or diminish the 
rights and obligations to which the Members agr eed.  This requires the proper application of 
customary rules of interpretation of public intern ational law to the agreed upon provisions of the 
covered agreements.  Therefore, any prohibition of zeroing must be found in the text of the 
Antidumping Agreement.  Aside from a prohibition of  zeroing in the context of average-to-average 
comparisons in original investigations, there is plainly no general prohibition of zeroing.   
 4. Mexico's proposed obligation to treat non-dum ped imports as a remedy for injurious dumping 
by reducing the assessment of antidumping duties on dumped imports depend s upon a definition of 
dumping that is not based upon the text of the Anti dumping Agreement, but on an abstract concept of 
dumping.  Ultimately Mexico's interpretati on cannot be reconciled with the commercial, 
administrative realities to which the Antidumping Agreement must relate.    
5. The prior panels addressing this issue have r ecognized the deficiencies inherent in Mexico's 
proposed interpretation and have found that the re levant text, the relevant context, and the well-
established prior understanding of the terms "dumpi ng" and "margin of dumping" as used in the 
Antidumping Agreement demonstrate that these concep ts are not devoid of meaning except in relation 
to the product as a whole.    
6. As detailed in our first written submission, Me xico's interpretation ca nnot be reconciled with 
the ordinary meaning of the terms with which dumping and margins of dumping are defined, and which describe dumping as occurring in the course of ordinary commercial transactions, and which do 
not define products as "introduced into the commerce" of the importing country "as a whole", or prices of all the products at issue in an assessmen t proceeding generally being set "as a whole".   
 
7. Mexico's interpretation cannot be reconciled w ith the Appellate Body's interpretation of the 
phrase "all comparable export transactions" in US – Softwood Lumber Dumping .   
 8. Nor can it be reconciled with the targeted dumping provision in the second sentence of Article 2.4.2;  with the importer- and import-specif ic obligation to pay antidumping duties;  with the  WT/DS344/R 
 Page D-13 
 
 
 existence of prospective normal value systems of ass essment as provided in Article 9;  and, with the 
effective functioning of antidumping duties as a remedy for injurious dumping.    9. Finally, let me reiterate the position of the Un ited States with respect to Mexico's particular 
claims in this dispute.  First, regarding Mexico's  "as such" claims, Mexico has failed to establish the 
existence of any measure that may be challenge d "as such", whether the measures are taken as 
described in Mexico's panel request – as they mu st be – or as a single measure as described in 
Mexico's first written submission.  Accordingly, Mexi co's "as such" claims should be rejected in their 
entirety.    
10. Second, regarding Mexico's "as applied" claim relating to the investigation of stainless steel 
from Mexico for which the Department of Commerc e used average-to-average comparisons without 
providing offsets for non-dumped comparisons, the Unite d States does not contest that its calculation 
in this investigation was inconsistent with th e obligation to account for "all comparable export 
transactions" in calculating the "margin of dumping" as these terms were interpreted by the Appellate 
Body in US – Softwood Lumber Dumping .   
 11. Third, a correct interpretation of the An tidumping Agreement does not impose an obligation 
to provide offsets for instances of non-dumping in assessment proceedings.  Accordingly, Mexico's 
"as applied" claims with re spect to the five periodic reviews should be rejected.   
 
12. Mr. Chairman, Members of the Panel, we a ppreciate this opportunity to present these closing 
comments and look forward to continuing to work with you on these issues.   
  WT/DS344/R 
Page D-14  
 
 ANNEX D-5 
 
 
THIRD PARTY ORAL STATEMENT  
OF CHINA 
 
 
1. Mr. Chairman, distinguished members of the pane l, it is my great honour to appear before you 
today to present the views of China as a third party to these proceedings.   
 2. Notwithstanding China did not submit a written submission to the panel, China would like to 
emphasize its systematic interests in this disput e regarding whether the "zeroing procedures" adopted 
by the United States in the original anti-dumping i nvestigation and periodic reviews are consistent 
with the GATT and the Anti-Dumping Agreement.   
 3. Both Mexico and United States don't contest the fact that all major issues arising under this 
case have been examined by the Appellate Body in previous anti-dumping disputes.  Thus, the 
reasoning and findings of the Appellate Body in th ese disputes can provide valuable guidance in the 
present case.  In this regard, China would like to draw the attention of the panel to the Appellate 
Body's findings in " EC - Bed Linen ", "US- Softwood Lumber V ", "US – Zeroing (EC1) ", "US – 
Softwood Lumber V (Art. 21.5-Canada) " and " US – Zeroing (Japan) ".  
 4. In these disputes, the Appellate Body found th at the zeroing procedure may be challenged "as 
such" and is prohibited in all circumstances whenever calculating the "margins of dumping" 
regardless of the specific phase or comparison methods.  To be more specific, no matter the 
comparing method is weighted average-to–weighted average ("W-W"), transaction–to–transaction ("T-T") or weighted average–to–transaction ("W-T"),  the use of zeroing in original investigation is 
always inconsistent with Articles 2.1, 2.4.2 and 2.4 of AD Agreement.  As to the zeroing 
methodology in the administrative reviews, it has al so been found incompatible with AD Agreement 
Article 9.3 and GATT Article VI:2.  On all these matters, China believes that the legal position is 
clear, and sees little purpose in a lengthy re-iteration of  the consistent jurisprudence developed by the 
Appellate Body in these cases.  Besides, Chin a can't find any remarkable new argument in 
United States' rebuttal comparing with those it has ra ised before. Since these arguments have all been 
dismissed by the Appellate Body with well-f ounded reasoning, China sees no reason why the present 
panel shall depart from the Appellate Body's prior rulings.   
 5. In light of the forgoing, China urges the Pane l to approve Mexico's claims that the zeroing 
measures adopted by the United States are inconsistent  "as such" with Articles 2.1, 2.4, 2.4.2 and 9.3 
of the AD Agreement.  It is time for the United St ates to eliminate the systematic use of zeroing, a 
practice which is not permissible under the WTO Agre ement and harmful to the balance of rights and 
obligations established by it.   
 6. Mr. Chairman, this concludes the oral statemen t of China as a third party to this proceeding.  
Thank you for your attention.    
  WT/DS344/R 
 Page D-15 
 
 
 ANNEX D-6 
 
 
THIRD PARTY ORAL ST ATEMENT OF THE  
EUROPEAN COMMUNITIES 
 
 
Mr. Chairman, Members of the Panel:   
 1. The European Communities appreciates this oppor tunity to appear before you today.  The 
European Communities makes this third party oral st atement because of its systemic interest in the 
Understanding on Rules and Procedures Governi ng the Settlement of Disputes ("DSU").   
 
2. This case also raises important substantive i ssues in relation to Article VI of the General 
Agreement on Tariffs and Trade 1994 and the Agr eement on Implementation of Article VI ("Anti-
Dumping Agreement") thereof.  However, none of the issues raised in this proceeding relating to anti-
dumping are new.  Mexico's claims appear to be  supported by a consistent body of reasoning and 
findings, contained in all reports issu ed by the Appellate Body since the EC-Bed Linen  case.  Further, 
the European Communities has been unable to detect anything new in the argumentation used by the 
United States to defend its zeroing methodologies and practices.    3. The European Communities' oral statement will th erefore be brief.  In its written submission 
the European Communities set out at length the syst emic reasons why in its view, this Panel should 
follow the findings and conclusions contained in previous Appellate Body reports on zeroing.
1   
 
4. It is not disputed that  adopted panel and Appellate  Body reports are binding, qua reports, only 
on the immediate parties to the dispute.  Further, like many other international adjudicatory systems, 
the WTO dispute settlement system does not formally recognise the doctrine of stare decisis  – the 
doctrine of binding judicial precedent.  But these pr inciples do not detract from the interest that the 
WTO dispute settlement system has in common with  all other responsible adjudicatory systems:  
maintaining consistency, stability and predictability  of the case law.  Further, as the 
European Communities has set out at length in its written submission, in all adjudicatory systems, 
whether national or international, that are two- or  multi-tier systems, decisions of the hierarchically 
superior body are binding on the hierarchically lower body, in particular on issues of law.   
 
5. The European Communities submits that in the WTO dispute settlement system the 
expectations upon panels are no different.  A param ount function of this system is to create and 
maintain a uniform body of rules.  This is clearly reflected in Art. 3.2 DSU, according to which the 
WTO dispute settlement system aims at providing  "security and predictability to the multilateral 
trading system".  The Appellate Body occupies a superior position in the hierarchy of this system 
(Art. 17 DSU).  Its very purpose is to provide pr edictability and stability to the multilateral trading 
system through its decisions on issues of law cove red in panel reports an d legal interpretations 
developed by panels.    6. It is beyond dispute that the practice of zeroing in anti-dumping cases has been contested 
many times in WTO dispute settlement proceedi ngs.  The Appellate Body in particular has 
adjudicated on the issues raised in this case frequently, including in cases involving different 
variations of zeroing, both in original anti-dumping investigations and review s, in different factual 
circumstances and between different parties.
2   
                                                      
1 See EC's written submission, 11 April 2007, part IV.   
2 In its written submission the European Communities has reviewed the salient reasoning and findings 
of the Appellate Body in each of these reports.  See EC 's written submission, 11 April 2007, part III.  Reference WT/DS344/R 
Page D-16  
 
 7. The United States does not contest this, but argues that this Panel should not follow these 
Appellate Body reports.  On the contrary, the Unit ed States explicitly invites this Panel to re-apply 
findings and follow the reasoning contained in panel re ports that have been rejected and overturned –
in many cases more than once– by the Appellate Body, in reports which have subsequently been 
adopted by the Dispute Settlement Body.   
 
8. The European Communities submits that the s uggestion by the United States that this Panel 
should be free to depart from adopted Appellate  Body reports on issues of law and legal 
interpretations relating to the cove red agreements, is misguided.   
 
9. The Appellate Body itself has addressed this very  question in several cases.  As set out in the 
European Communities' written submission, some of these cases are particularly relevant as they deal 
with appeals in zeroing cases.  In US –Softwood Lumber V (Art. 21.5 – Canada),  the United States 
requested the Appellate Body not to "import w holesale the findings and reasoning" from another case, 
EC – Bed Linen,  on the following grounds:  the United States was not a party to the latter dispute, the 
arguments raised in that case were different, and th e United States' practice of zeroing was not at issue 
in the EC – Bed Linen  case.   
 10. The Appellate Body started its response to this  request by recalling its previous statement in 
Japan – Alcoholic Beverages II, according to which adopted pa nel reports create "legitimate 
expectations among Members".  It also referred to its statement in US – Shrimp (Article 21.5 – 
Malaysia) , according to which this principle of legitim ate expectations also applies to adopted 
Appellate Body reports.  The Appellate  Body then recalled that it had in US – Shrimp (Article 21.5 – 
Malaysia)  explicitly approved of a panel report that had used reasoning and findings of an adopted 
Appellate Body report; and that it explicitly held that  the panel had been correct in using the Appellate 
Body's findings as a "tool for its own reasoning" .  The Appellate Body proceeded with citing 
Article 3.2 of the DSU in full and stated, in respon se to the United States' request, that it had decided 
to take account of the reasoning and findings  contained in the Appellate Body report in EC – Bed 
Linen,  "as appropriate".
3   
 11. Furthermore, there should be no doubt that the Appellate Body expects
 panels to follow its 
conclusions:  in US – Oil Country Tubular Goods Sunset Reviews , the Appellate Body explicitly held 
that "following the Appellate Body's conclusions in earlier disputes is not only appropriate, but is 
what would be expected from panels, es pecially where the issues are the same"4; and in US – Zeroing 
(Japan),  the Appellate Body took firm exception to the f act that the panel had come to conclusions on 
the basis of reasoning relating to the Anti-Dump ing Agreement, which the Appellate Body had 
rejected earlier.5   
 
                                                                                                                                                                     
is made in particular to the adopted Appellate Body Reports in the following cases:  EC – Bed Linen , adopted 
12 March 2001;  US – Softwood Lumber V , adopted 31 August 2004;  US – Zeroing (EC1) , adopted 
9 May 2006;  US – Softwood Lumber V (Article 21.5 – Canada),  adopted 15 August 2006;  US – Zeroing 
(Japan),  adopted 9 January 2007.   
3 See EC's written submission, 11 April 2007, paras. 155-159.   
4 Ibid., para. 166.   
5 Ibid., para. 85.    WT/DS344/R 
 Page D-17 
 
 
 12. In conclusion, the European Communities s ubmits that as the Appellate Body is the 
hierarchically superior body in the WTO dispute se ttlement system, tasked with deciding on issues of 
law and legal interpretations, its rulings must be  regarded as commanding particular authority for 
panels, as authoritative pronouncements on the law.  The United States' submission that this Panel 
should not follow Appellate Body findings and r easoning in zeroing cases, and that analogous cases 
can be decided in a contrary sense by this Panel, must be rejected.   
 13. The European Communities stands ready to par ticipate further in the discussion, or to answer 
any questions that this Panel may have regarding th e matters set out in its written submission.  Thank 
you for your attention.   
 
 WT/DS344/R 
Page D-18  
 
 ANNEX D-7 
 
 
THIRD PARTY ORAL STATEMENT  
OF JAPAN 
 
 I. INTRODUCTION 
 
1. Mr. Chairman, distinguished Members of the Pa nel, on behalf of the Government of Japan, I 
thank you for your attention to this matter.  This  morning, Japan will focus mainly on the arguments 
of the parties concerning the WTO-consistency of the use of zeroing in periodic reviews and 
endeavour to reinforce Japan's position on the issue as much as possible.   
 
2. Before talking about the issues related to periodic reviews, let me briefly point out the 
fundamental flaw in the United States' argument on the "scope of the as such  claims" made by 
Mexico.  The United States contends that the as such  claim made by Mexico on "a single zeroing 
measure, the Zeroing Procedures" is baseless b ecause it addressed only limited aspects of the use of 
zeroing within the whole antidumping regime of the United States.  In doing so, the United States 
even quotes the Appellate Body's report in United States – Zeroing  (DS322) brought by Japan.  
However, in that dispute, the point that the Appe llate Body made clear was to the contrary to the 
United States' contention.  There, the Appellate B ody upheld the Panel's conclusion that the "zeroing 
procedures" under different comparison methodologies, and in different stages of antidumping proceedings, simply reflect different manifestations of a single rule or norm.
1  The mere fact that 
Mexico's request for panel establishment did not co ver as wide range of zeroing as the Japan's case 
never undermines the single nature of zeroing pro cedures which can be challenged as such.  The 
zeroing procedures, as such, have been declared inc onsistent with the US obligations in DS322, and 
the subject of the Mexico's claims is simply a part of such WTO incompatible measure.   
 II. THE UNITED STATES MISUNDERSTANDS THE NOTION OF "DUMPING" 
 
3. Turning to specific arguments, first of all, Japan would like to point out that the normative notion of "dumping" that is defined by the pr ovisions of Antidumping Agreement and the GATT 1994 
is different from the individual transaction at a price lower than normal value of a product.   
 
4. The United States argues that "dumping neve rtheless occurs at the level of individual 
transactions" as a starting point of its argument with regard to permissibility of zeroing in periodic reviews.
2  However, when the exporting price is less than  normal value, it is just a "discount" that 
occurs at the level of the individual transactions.  It is not "dumping" as set forth in the provisions of Antidumping Agreement and the GATT 1994.  We can  find no textual support in the Antidumping 
Agreement to consider a mere "discount" at the le vel of an individual transaction as "dumping".  As 
the Appellate Body has repeatedly stated clearly, the existence of dumping has to be decided only in 
relation to "a product" as defined by the authority, as the texts of Article 2.1 of Antidumping Agreement and Article VI of the GATT 1994 suggest
3.   
 
5. Thus, the interpretation of the United States that "dumping" can exist at the level of an 
individual transaction is in contradiction with th e interpretation of Antidumping Agreement and the 
                                                      
1 See Appellate Body Report, US – Zeroing (Japan) , para. 88.   
2 United States' First Written Submission, para.89.   
3 Appellate Body Report, US –Zeroing(Japan) , paras. 108-109, 115;  Appellate Body Report, US – 
Softwood Lumber V , para 93.    WT/DS344/R 
 Page D-19 
 
 
 GATT 1994 by the Appellate Body in the past zeroi ng disputes, and therefore subsequent arguments 
of the United States based on such misinterpretation  are also incorrect.    
III. ARTICLE 9 READ TOGETHER WITH ARTICLE 2 OF THE ANTIDUMPING 
AGREEMENT DOES NOT SUPPORT THE ARGUMENTS OF THE 
UNITED STATES 
 
6. Secondly, the United States submits that "there  is no textual support in Article 9.3 for the 
view that the AD Agreement requires an e xporter-oriented assessment of antidumping duties"
4, and 
asserts that "the obligation set forth in Article 9. 3 to assess no more in antidumping duties than the 
margin of dumping" is applicable "a t the level of individual transactions".5   
 7. Japan does not deny that the amount of antidumping duty can be assessed on individual transactions.  However, as required by Ar ticle 9.3 of the Antidumping Agreement,  the assessment 
shall not lead to the imposition of an amount exceeding the "margin of dumping as established under 
Article 2".  And the "margin of dumping" must be determined for the product as a whole, as the 
Appellate Body has repeatedly pronounced.    8. The Appellate Body has also held that Artic les 9.2 and 9.5 of the Antidumping Agreement and 
Article VI:2 of the GATT 1994 confirm the vi ew that antidumping duties are imposed "on the 
product", not on individual transactions.
6  Moreover, consistent with th e rules under Article 2 of the 
Antidumping Agreement, the "margin of dumping" must be established for the "product" as a whole.7  
As a result, in a duty assessment review, the authority  must ensure that the aggregate amount of the 
duty levied on the product during the review period does not exceed the margin of dumping for the product for that period.    
9. Accordingly, the argument of the United States is not supported by the texts as well as the 
interpretation by the Appellate Body of th e provisions under the Antidumping Agreement and 
GATT 1994.    
IV. THE EXISTENCE OF A PNV SYSTEM CANNOT JUSTIFY ZEROING 
 10. Thirdly, the United States continues to argue  that, under the prospective normal value (PNV) 
system, "margins of dumping" may be calculated for individual import transactions.
8   
 11. However, the Appellate Body has previous ly considered, and rejected, this argument.
9  The 
Appellate Body concluded that a "m argin of dumping" is not determin ed at the time of importation on 
a transaction specific basis10:  margins are first calculated in original investigations;  antidumping 
duties are imposed upon each entry for importation of  the product;  the amount of duties initially 
imposed may be reviewed, and in the case of the prospective system, a "refund" must be paid in accordance with Article 9.3.2 of the Antidumping Ag reement "when the duties paid exceed the actual 
margin of dumping".
11  In any review under Article 9.3 – under any system of duty collection – the 
                                                      
4 United States' First Written Submission, para.85.   
5 Ibid., para.83.   
6 Appellate Body Report, US – Softwood Lumber V , para.94 and 99.   
7 Appellate Body Report, US – Zeroing(Japan) , para. 110.   
8 United States' First Written Submission, para.93.   
9 Appellate Body Report, US – Zeroing (Japan) , paras. 161 and 162.  
10Appellate Body Report, US – Zeroing (Japan) , para.151.  See also , Appellate Body Report, US – 
Zeroing (EC) , para. 128.  Appellate Body Report, US – Softwood Lumber V (Article 21.5 – Canada) , para. 87 
("the results of transaction-specifi c comparisons are not, in themselves, "margins of dumping" ").   
11 Appellate Body Report, US – Softwood Lumber V (Article 21.5 – Canada) , para. 112.   WT/DS344/R 
Page D-20  
 
 authority must determine a margin of dumping for the product as a whole by aggregating all multiple 
comparison results.
12   
 
V. MEMBERS MUST REFUND TO ENSURE THAT THE AMOUNT OF 
ANTIDUMPING DUTIES DOES NOT EXCEED THE MARGIN OF DUMPING 
DETERMINED FOR AN EXPORTER 
 
12. Finally, it is not limited to the case of the pr ospective system that the authority needs to 
refund all or part of the deposits to meet the ob ligation under Article 9.3.  Japan emphasizes that 
under Article 9.3, to the extent that the total amount of duties were collected at the time of importation 
in the form of a deposit in excess of the margin of dumping determined upon review for individual 
exporters, the authority should refund such exceed ing amount.  As stated by the Appellate Body, 
"[u]nder any system of duty collection, the ma rgin of dumping established in accordance with 
Article 2 operates as a ceiling for the amount of anti-du mping duties that could be collected in respect 
of the sales made by an exporter"13 and the Antidumping Agreement "provides for a refund if the 
ceiling is exceeded".14   
 13. Accordingly, regardless of what sort of dut y assessment system is used, the authority must 
refund to the importers (1) all deposits paid at th e time of entries when no margin of dumping is 
established in reviews for those entries, or (2) such amount of deposits as exceed the margin of 
dumping as established in such reviews.   
 
VI. CONCLUSION 
 
14. Japan respectfully requests the Panel to examin e carefully the facts presented by the parties to 
this dispute taking into consideration the points th at Japan has raised, so as to ensure fair and 
objective application of the Antidumping Agreement.   Thank you for your attention, Mr. Chairman, 
distinguished Members of the Panel.     
                                                     
 
12 Appellate Body Report, US – Zeroing (EC) , para. 132.   
13 Appellate Body Report, US – Zeroing (Japan) , para. 162.   
14 Appellate Body Report, US – Zeroing (Japan) , para.163.    WT/DS344/R 
 Page D-21 
 
 
 ANNEX D-8 
 
 
THIRD PARTY ORAL STATEMENT  
OF THAILAND 
 
 
1. Mr. Chairman and Members of the Panel:  Th ailand appreciates the opportunity to participate 
in this proceeding and to present its views today.    2. Thailand reserved its right to participate as a third party in this proceeding under Article 10.2 
of the Dispute Settlement Understanding  due to our concern about the continued use of "zeroing" by 
the United States in original investigations as well as periodic reviews.  In Thailand's view, the use of 
zeroing in any circumstance is inconsistent with both the spirit and the substance of Article VI of the 
GATT 1994  and the Anti-Dumping Agreement .  In effect, the use of zeroing either artificially creates 
margins of dumping where none would otherwise ha ve been found or, at a minimum, artificially 
inflates margins of dumping and the consequent imposition of anti-dumping measures, whether in an original proceeding or a periodic review.  As ev idenced by the numerous zeroing-related disputes 
either concluded or initiated against the United St ates just over the course of the previous year, 
Thailand is not alone in this view.  3. Thailand generally supports the arguments made by Mexico, the European Communities, and 
Japan regarding the United States' use of zeroing in  this dispute.  Because these delegations have 
already submitted detailed analyses, we do not think it  necessary to repeat those arguments today.  We 
instead simply remind the Panel that the Appellate Bo dy's rulings to date on the issue of zeroing have 
coherently and consistently addr essed the numerous different arguments put before it in each dispute, 
ranging from EC – Bed Linen  to the latest US – Zeroing (Japan) .  To summarize, the Appellate Body 
has held that whenever an investigating authorit y uses intermediate comparisons between subgroups 
of export prices and normal values – whether on a mo del-by-model, transaction-by-transaction or any 
other basis – as a step to arrive at the overall du mping margin for that product, the investigating 
authority may not, in aggregating those intermediate  comparisons, "zero" the results of some of those 
comparisons.    4. Regardless of whether each successive Appellate Body report states this principle in identical 
terms, addresses all of the different methodologies in which zeroing can be used, or repeats all of the 
reasoning of previous reports, Thailand considers th is principle to have been fully and correctly 
reasoned by the Appellate Body and to  apply equally and fully to the issues that are before the Panel 
in this case.  We agree also with the arguments made by the European Communities on the need for 
security and predictability within the multilateral trading system.
1  Thailand therefore urges this Panel 
to follow the reasoning and findings of the Appellate  Body, and rule that as submitted by Mexico the 
use of zeroing by the United States in original inv estigations and periodic reviews - regardless of the 
comparison methodology used - is inconsistent w ith its obligations under Article VI of the 
GATT 1994  and the Anti-Dumping Agreement .   
 5. Thank you.   
 
                                                     
 
1 Third Party Submission by the European Communities, para. 167.   WT/DS344/R 
Page D-22  
 
 ANNEX D-9 
 
 
EXECUTIVE SUMMARY OF THE OPENING STATEMENT 
OF MEXICO – SECOND MEETING 
 
 I. INTRODUCTION 
 
Mr. Chairman, Members of the Panel:    1. In this opening statement, we do not intend to  provide an exhaustive presentation of Mexico's 
case.  Instead, we limit our discussion to certain key points concerning Mexico's claims against the 
United States' Zeroing Measures respecting model zer oing in original investigations and simple 
zeroing in periodic reviews.    
II. MODEL ZEROING IN ORIGINAL INVESTIGATIONS 
 
2. Mexico maintains its request for a finding on th is claim.  As outlined in Mexico's response to 
Question 13 of the Panel, the scope of the United States' abandonment of model zeroing in original 
investigations is incomplete.  Accordingly, for im plementation reasons, a Panel finding on this claim 
is necessary.  Mexico also maintains its "as such" claim regarding model zeroing in original 
investigations to the extent that  such zeroing in original investig ations has not been fully abandoned 
by the United States, as described in Mexico's re sponse to Question 13 of the Panel.  Although the 
United States has not acknowledged the merits  of this claim, Mexico has presented a prima facie case 
with respect to each requisite element of this cl aim and the United States has not rebutted Mexico's 
prima facie  case.   
 
III. SIMPLE ZEROING IN PERIODIC REVIEWS 
 
3. Mexico and the United States have filed de tailed submissions on Mexico's claim regarding 
simple zeroing in periodic reviews.  It is clear from a review of these submissions that Mexico has presented a prima facie  case with respect to each requisite element of this claim and that the 
United States has not rebutted Mexico's prima facie  case.   
 
IV. OTHER KEY ISSUES 
 
4. We would like to elaborate upon certain key issues that have been raised by the United States.   
 A. E
VIDENCING A MEASURE THAT CAN BE CHALLENGED AS SUCH 
 
5. The Appellate Body has found that an "as su ch" claim of the kind asserted by Mexico can be 
sustained where the complaining party establishes clearly through arguments and supporting evidence:  (1) that the alleged rule or norm is a ttributable to the responding Member;  (2) its precise 
content;  and (3) that it has genera l and prospective application.   
 
6. The United States does not appear to seriously ch allenge the first or second prongs of this test.  
There is no doubt that the zeroing measure is attribut able to the United States, specifically that it is 
attributable to the USDOC as the investigating au thority in US anti-dumping proceedings.  Likewise, 
Mexico has amply documented the specific conten t of the Zeroing measures as applied by the 
USDOC in original investigations and periodic review s and the fact that this measure is invariably  WT/DS344/R 
 Page D-23 
 
 
 applied in all periodic reviews and in all original investigations (at least until February 2007) as rule 
of general and prospective application.    B. T
HE MANDATORY /DISCRETIONARY DISTINCTION  
 
7. As it has done in the past, the United States seeks to sidestep these conclusions by asserting 
that zeroing is not mandated  under the US anti-dumping laws.  In its response to Question 19 of the 
Panel, the United States argues that "[i]n order to find that a measure, as such, breaches an obligation, 
the measure must mandate that breach".  In making this argument, the United States mischaracterizes the applicability of the mandatory/discretionary di stinction to the facts of this dispute.   
 
8. In both US – Zeroing (EC) and US – Zeroing (Japan) , there was no issue as to whether 
zeroing was "mandated" under US law.  There is si milarly no such issue in this dispute.   
 C. M
ATHEMATICAL EQUIVALENCY  
 
9. Mexico notes that the mathematical equivalenc y argument was considered and rejected by the 
Appellate Body in both US – Softwood Lumber V (21.5)  and US – Zeroing (Japan) .  The argument 
has no merit based on these two adopted Appellate Body reports.    10. Although there is no need for Mexico to further rebut the mathematical equivalency 
argument, in light of the fact that the United States has introduced Exhibit US-10 to support its 
response to Question 15 of the Panel, Mexico is pr esenting an example of its own that demonstrates 
the absence of mathematical equivalency.    11. In order for the US allegation of "inutility" to  be sustained in this case, its argument of 
mathematical equivalency must hold in all possible circumstances.  Mexico will employ the figures in 
the United States' example to show that mathematical equivalency will not hold in all possible 
circumstances.  The United States bases its ex ample on the assumption that identical period-long 
average normal values in both average-to-average  and average-to-transaction comparisons must 
always be used.  This assumption was adopted, erroneously in Mexico's  view, by panels in US – 
Softwood Lumber V (21.5)  and US – Zeroing (Japan).
1  The Appellate Body has neither specifically 
endorsed nor rejected this assumption in its decisions to date.   
 12. The statutory provisions governing targeted dumping are set out in 19 U.S.C.  § 1677f-1(d)(1)(B) and the regulatory provisions in 19 CFR § 351.414(e) and (f) ( Exhibit  MEX-3 ).  
Paragraph (e), inter alia,  sets out a requirement for contemporan eous monthly average normal values.  
Thus, the USDOC Regulations explicitly link the "average-to-transaction" method in targeted 
dumping investigations to the use of contemporan eous monthly average normal values.  Moreover, 
the Regulations specifically link the "average-to-aver age" method with the use of period-long average 
normal values.    13. Mexico presents in its example that mathema tical equivalency does not exist if intermediate 
monthly average normal values are used in the aver age to transaction method and period-long average 
normal values are used in the aver age to average method.  Mexico offers this example because it is 
entirely consistent with US domestic law on this subject.    14. The examples provided above demonstrate, by means of the same comparison methodologies 
specified under the USDOC Regulations for A-T comp arisons made in periodic reviews and for A-T 
comparisons used to evaluate targeted dumping in original investigations, that the US claim of 
                                                     
 
1 Panel Report, US – Softwood Lumber V (21.5) , paras. 5.49-5.51;  Panel Report, US – Zeroing (Japan) , 
paras. 7.128-7.129.   WT/DS344/R 
Page D-24  
 
 mathematical equivalency, absent zeroing, fails.  I ndeed, there is plainly no mathematical equivalency 
between these methods, because the use of monthly no rmal values in the US system of conducting A-
T comparisons removes the prospect  of uniform equivalency.   
 
V. CONCLUSION 
 
15. Mexico again reminds the Panel that the meas ure at issue challenged as such by Mexico is 
identical to the measure decided by the Appella te Body in cases brought by Canada, the EC and 
Japan.  The Appellate Body has consistently dete rmined that this measure is contrary to the 
United States' obligations under the Agreements.  In  reaching its determinations, the Appellate Body 
has considered and rejected virtually all of the arguments presented by the United States in this 
dispute and has interpreted the text of the Agre ements in accordance with recognized principles of 
international law applicable to dispute settlement  proceedings and has applied its reasoning in a 
coherent and consis tent manner.   
 
16. Mr. Chairman, and members of the Panel, these prior decisions must be taken into account.  
Their reasoning has withstood the arguments posed ag ainst them by the United States.  Third Party 
submissions in this case overwhelmingly support our case.  For the sake of the security and predictability of the WTO system, and to ensure th at the Agreements negotiated by the Members are 
enforced in accordance with their text, we urge you to sustain Mexico's claims in their entirety.   
  WT/DS344/R 
 Page D-25 
 
 
 ANNEX D-10 
 
 
EXECUTIVE SUMMARY OF THE OPENING STATEMENT OF THE 
UNITED STATES - SECOND MEETING  
 
 
1. We note Mexico's acknowledgment in response to the Panel's questions that its claims are 
limited by the language of its panel request to the use of model zeroing in average-to-average 
comparisons in original investigations and simple zeroing in periodic reviews.  Mexico continues to 
cling to its argument that there is a single measu re taken by the United States that requires the 
Department of Commerce to "zero".  Mexico presen ts no new evidence of the existence of a measure 
that prescribes and requires specific action.  It mere ly continues to present th e same evidence of past 
actions by Commerce.  Mexico has not demonstrat ed that there is any "as such" measure requiring 
zeroing, because there is no such measure.    2. Mexico insists on making accusations regardi ng alleged non-compliance by the United States 
with respect to the DSB recommendations and rulings in US – Zeroing (EC) .  Mexico states that it 
"does not agree that the United Stat es fully abandoned the use of 'mode l zeroing' in investigations as 
of February 22, 2007".  Mexico argues that full co mpliance would require the United States to revise 
all existing measures.    3. Aside from the fact that it is not for Mexico  to unilaterally determine the non-compliance of 
another Member, as DSU Article 23 makes clear, we note that the EC does not appear to share 
Mexico's view.  In its recent request for consulta tions under Article 21.5, the complaint of the EC is 
limited to its "as applied" claims.  Indeed at th e 24 April 2007 meeting of the DSB, the EC welcomed 
the decision to abandon zeroing in original investigations when calculating the dumping margin on a weighted average-to-weighted average basis.    
4. Moreover, in arguing that a Member can impl ement a ruling against a measure "as such" only 
by revising all applications of that measure, Me xico improperly blurs the distinction between "as 
such" and "as applied" claims.    5. Mexico also continues to argue that a sugg estion from the Panel regarding implementation is 
necessary.  However, it is well-established that a Member has the right to determine the means of 
implementation.  Further, Mexico appears to be  seeking though a suggestion a result that goes well 
beyond any right it might have under the Agreemen t.  In this connection, we note Mexico's 
recognition that the provision of offsets in the origin al investigation on stainless steel would still result 
in a margin of dumping well above the de minimis  threshold.  Therefore, the antidumping order would 
remain in place.   
 
6. Regarding the alleged legal basis for requiring o ffsets, Mexico explains that its claim that the 
Antidumping Agreement contains an obligation to reduce antidumping duties to account for instances 
of non-dumping rests on two essential textual found ations.  These two supposed foundations fail to 
support Mexico's claims with respect to periodic reviews.   
 
7. Mexico's first alleged textual foundation is  that the terms "dumping" and "margin of 
dumping" as they are defined in Article VI:1 and VI:2 of the GATT 1994 and in Article 2.1 of the Antidumping Agreement have no meaning except in rela tion to the product taken in its entirety.  The 
text of these definitions, however, does not contain the words "taken in its entirety" or "taken as a 
whole" or any words to that effect.  Instead, th e text of these definitions contains only the word 
"product".  Mexico admits that the term "product" can  refer to individual transactions in the context of WT/DS344/R 
Page D-26  
 
 numerous provisions of the GATT 1994, including within Article VI.  Nevertheless, Mexico argues 
that those uses of the term "product" are distinguis hable because they arise in contexts other than the 
determination of margins of dumping.  By so arguing, Mexico effectively concedes that the ordinary meaning of the term "product" – standing alon e – cannot serve as the textual basis for an 
interpretation that requires the phrase "margin of dumping" to relate solely to the "product as a 
whole".  Moreover, Mexico has identified no other te xtual basis for interpreting the term "product" – 
as used in the definitions of "dumping" and "margin of dumping" – to mean the "product as a whole".  Nor has Mexico identified any textual basis for excl uding the possibility that the term "product" – as 
used in these definitions – may include th e concept of indivi dual transactions.   
 
8. In fact, the text of these definitions suppor ts the individual transaction meaning of the term 
"product", since the price of a product is establis hed for each transaction and since each transaction is 
introduced into the commerce of the importing country .  The fact that prices are set in individual 
transactions and the fact that products are intr oduced into the commerce of an importing country 
pursuant to individual transactions are not "subjectiv e views" of the United States, as Mexico argues.  
Rather, this is the actual commercial conduct that is  described by the text of the provisions of the 
Antidumping Agreement.  As the panel in US – Zeroing (Japan)  concluded, the definition of dumping 
itself "undermines the argument that it is not permis sible to interpret the concept of dumping as being 
applicable to individual sales transactions".    9. Mexico argues that a second essential foundation of  its claims in this case is the notion that 
the remedies contained in the Antidumping Agreement are not directed toward importers.  It is not 
disputed that dumping results from the pricing beha viour of exporters and producers.  It is also 
indisputable, however, that antidumping duties are dir ected at importers.  The fact that importers are 
the parties that actually pay the antidumping duties must not be ignored if antidumping duties are to 
be an effective remedy to "offset or prevent" dumpi ng as provided in Article VI:2 of the GATT 1994.   
 
10. Mexico misunderstands the remedies provide d for in the Antidumping Agreement as punitive 
measures directed at the conduct of producers and e xporters.  On the contrary, antidumping duties are 
remedial measures taken to "offset or prevent" dumping and its injurious effects by removing any 
incentive the importer has to import merchandise at less than normal value and to induce the importer 
to increase the resale price to cover the expe nse of the antidumping duties and prevent further 
injurious effect.  Mexico interprets the Anti dumping Agreement to require that the amount of 
antidumping duties be reduced in the amount by whic h some transactions are sold at prices in excess 
of normal value.  Mexico is essentially arguing th at non-dumped transactions constitute a remedy for 
dumped transactions that supplants the remedy provided for in the Antidumping Agreement.  There is no basis for this interpretation in the provisions  of the GATT 1994 or the Antidumping Agreement.   
 
11. The lack of a textual basis for Mexico's cl aims with respect to periodic reviews is also 
demonstrated by Mexico's attempt to apply the "product as a whole" concept in a manner that is 
detached from the concept's underlying textual basis in the first sentence of Article 2.4.2 of the 
Antidumping Agreement.  The concept of "product as whole", however, was originally derived from 
the phrase "all comparable export transactions" in the fi rst sentence of Article 2.4.2.  Not surprisingly, 
Mexico is forced to acknowledge that the phrase "all comparable export transactions" cannot lend any 
support to its claims with respect to periodic review s, because that phrase pertains only to average-to-
average comparisons in original investigations.    12. Nevertheless, Mexico attemp ts to find support for its interpretation in the Appellate Body 
report in US – Softwood Lumber Dumping  by asserting that the phrase "all comparable export 
transactions" was not integral to the Appellate Body's  reasoning in that report.  Mexico's assertion is 
erroneous, because the Appellate Body expressly stated that it was interpreting the term "margins of 
dumping" and the phrase "all comparable export transac tions" in an "integrated manner".  Thus, the 
Appellate Body did not ignore, but instead based  its findings on, the phrase "all comparable export  WT/DS344/R 
 Page D-27 
 
 
 transactions".  In addition, the fact that the Appe llate Body was not deriving its interpretation of 
"margins of dumping" solely from the definitions in Article 2.1 of the Antidumping Agreement and 
Article VI of the GATT 1994 is further demonstrated by the fact that the Appellate Body declined to 
address the contextual argument that a general prohi bition of zeroing would be inconsistent with the 
provision for transaction-to-transaction comparisons in Article 2.4.2.  If the Appellate Body was 
articulating a general prohibition of zeroing based on  the definitional provisions, as Mexico argues, 
there would have been no sound basis for declining to address the transaction-to-transaction context.   
 13. For these reasons, Mexico's proposed interpreta tion is at odds with the provisions of the 
Antidumping Agreement upon which it relies.  With resp ect to Article VI:2 and Ad Article VI:2 of the 
GATT 1994, and Articles 2.2, 2.4.2 second sentence,  and Article 9 of the Antidumping Agreement, 
the implications of the interpretation proposed by Mexico provide further contextual support for the 
conclusion that Mexico's interpretation is not corr ect.  Mexico's proposed interpretation carries with it 
implications that simply cannot be reconciled with these provisions.    
14. Article 2.4.2 provides for average-to-transac tion comparisons under certain circumstances as 
an alternative to average-to-average or transac tions-to-transaction comparisons.  The interpretation 
offered by Mexico is incorrect because it renders  inutile the average-to-transaction comparisons 
provided for in the second sentence of Article 2.4.2.  Contrary to Mexico's arguments, the United States is not asserting an "affirmative defe nse" based on the second sentence.  Rather, the 
United States is arguing that application of the customary rules of interpretation of public 
international law leads to the conclusion that Mexico 's proposed interpretation fails to give effect to 
the provisions of Article 2.4.2, second sentence.    15. The redundancy of the average-to-transaction comparison type with the average-to-average 
comparison type, if offsets are granted, is a function of the mathematics of calculating weighted 
averages, and can be readily demonstrated, as the United States did in its response to the Panel's 
questions.  As detailed in our submissions, under Mexico's interpretation that the Antidumping 
Agreement incorporates a general prohibition of dum ping, this comparison type is rendered a nullity 
because it cannot mathematically produce a result that differs from the average-to-average 
comparison type.    
16. With respect to Article 9.3, Mexico ar gues that excess antidumping duties have been 
assessed.  This argument rests on its misinterpretation of the term "margin of dumping" in Article 9.3 
as relating exclusively to the product "as a whole", and as considered exclusively from the perspective 
of the exporter and on an aggregate basis over some frame of reference that is nowhere mentioned in 
the text.  This interpretation of the term "margin of dumping" in Article 9.3 is not supported by the 
text of the Article.  Indeed, this interpretation is at odds with the text of Article 9.3, which provides 
for determination of final liability for antidumping du ties that are paid by importers on the basis of 
individual import transactions.    17. The mismatch between the nature of the as sessment proceedings provided for in Article 9.3 
and the interpretation of the term "margin of du mping" proposed by Mexico result in perverse 
incentives and absurd results.  In particular, as pr eviously noted, the reduction of antidumping duties 
to account for non-dumped transactions will result in a remedy that is insufficient to "prevent or 
offset" dumping and its injurious effects as intended by Article VI:2 of the GATT 1994.  Moreover, 
the offsets contemplated by Mexico would c onfer an additional competitive disadvantage upon 
importers who refrain from importing dumped mercha ndise from the same exporter or producer as an 
importer that does import dumped merchandise.  Under Mexico's proposed interpretation, the 
antidumping duty liability for the importer of the dump ed transactions would be reduced by the offset 
attributable to the non-dumped import transactions.  This kind of competitive disincentive to engage 
in fair trade could not have been intended by th e drafters of the Antidumping Agreement and should 
not be accepted by the Panel as consistent with a correct interpretation of Article 9.3.   WT/DS344/R 
Page D-28  
 
 18. In addition, an obligation to account for other imports in assessing antidumping duties on a 
particular entry is contrary to the very concept of a prospective normal value system provided for in 
Article 9.  Under such a system, the amount of  liability for payment of antidumping duties is 
determined at the time of importation on the basis of  a comparison between the price of the individual 
export transaction and the prospective normal valu e.  If the margin of dumping must relate 
exclusively to an aggregation of all transactions  constituting the "product as a whole", as Mexico 
argues, the administration of such an assessme nt system cannot function as intended.   
 19. Under Mexico's interpretation, a prospec tive normal value assessment system necessarily 
requires retrospective reviews on the basis of the aggregation of transactions because, according to 
Mexico, the margin of dumping for the "product as a whole" can never be known at the time of 
importation.  Nothing in the text of Article 9, how ever, suggests that the refund proceeding described 
therein necessarily must relate to an aggregated examination of all transactions.  Nor does Mexico 
attempt to explain why, if refund proceedings under Article 9.3 require aggregation of transactions for 
the "product as a whole", Article 9.3 fails to pr ovide for any time frame over which the transactions 
would be aggregated.  Thus, it is impossible to di scern from the text the universe of transactions that 
comprise the "product as a whole".    20. Mexico tries to avoid the natural conclusion of its own argumentation by explaining that the 
possibility of retrospective refund proceedings woul d arise in a prospective normal value system only 
if the sum total of antidumping duties applied upon importation were to exceed the margin of 
dumping determined on the basis of aggregating all transactions and providing offsets for non-
dumped transactions.  But, under Mexico's own interp retation, this would arise in virtually every 
circumstance.  Upon entry of any non-dumped tran saction, under a prospective normal value system, 
zero antidumping duty liability is incurred.  Under Me xico's interpretation, however, each of those 
non-dumped transactions will result in an offset that  must reduce the antidumping duty liability for the 
other dumped transactions.  Thus, the only way to av oid the necessity of a retrospective review under 
Mexico's interpretation of a prospective norma l value system is if there are no non-dumped 
transactions.  This interpretation c ontradicts the prospective nature of the assessment system described 
in the text of Article 9.    21. Nevertheless, Mexico argues that the US  position renders the refund proceeding a nullity 
because it means that, without an aggregated retros pective determination of the margin of dumping, 
the margin of dumping and the antidumping duty app lied at the time of importation would always be 
identical.  This is not correct; a more limited re fund proceeding is consistent with the prospective 
nature of this type of  assessment system.  Fo r example, a refund proceeding would be necessary to 
deal with instances in which the price or other re levant elements of the transaction change after 
importation of the product occurs.  In such inst ances the actual margin of dumping may differ from 
the antidumping duty applied upon importation.    22. Mexico also argues that zeroing is inconsis tent with the "fair comparison" requirement of 
Article 2.4 because it is "biased" and "inflates" the margin of dumping.  The relevant text of Article 2.4, however, provides only that a "fair co mparison shall be made between the export price 
and the normal value".  It is not disputed, however, that the United States makes a "fair comparison" 
between export price and normal value for each export transaction in an assessment proceeding.  
Mexico's claims relate not to the comparison of export price and normal value, but to a supposed 
obligation to aggregate the results of those compar isons.  Mexico has repeatedly argued that zeroing 
does not occur when export price and normal value are compared, but when the results of those 
comparisons are aggregated without providing offset s for the non-dumped transactions.  Accordingly, 
Mexico's complaints with respect to zeroing can  have no bearing on whether the United States makes 
a fair comparison of export price and norma l value consistent with Article 2.4.   
  WT/DS344/R 
 Page D-29 
 
 
 23. Even if the "fair comparison" requirement of Article 2.4 were pertinent to Mexico's claims, 
there is no textual basis in Article 2.4 for conc luding that the denial of offsets for non-dumped 
transactions is unfair.  If the Panel finds, as prio r panels have found, that it is permissible to 
understand the term "margi n of dumping" as used in Article 9.3 as applying to an individual 
transaction, then there will be no basis for a fi nding that the margins of dumping calculated by the 
United States in periodic reviews are "inflated" or the result of "bias".   
 24. In summary, Mexico has failed to reconcile its proposed general prohibition of zeroing with a 
correct interpretation based on the text and contex t of the relevant provisions of the Antidumping 
Agreement.  The practical consequences of adop ting Mexico's interpretation counsel strongly in 
favour of the interpretation adopted by prior panels , which is that, except fo r the context of average-
to-average comparisons in investigations, the Antidumping Agreement does not impose an obligation 
to provide offsets for non-dumping.